First Quarter 2015 April 24, 2015 BMV: RASSINI www.rassini.com
First Quarter 2015 Highlights Net revenue increased 6.8% year-over-year to $3,207 million Mexican pesos. EBITDA grew 35.1% to $537.0 million Mexican pesos, with an EBITDA margin of 17%. Net income before taxes and minority interest increased 22.5% year-over-year to $297.8 million Mexican pesos. Net Debt/annualized EBITDA ratio as of 1 st Q 15 was 1.0x. EBITDA/Net Interest Expense ratio as of 1 st Q 15 was 8.5x. 2
Operational and Industry Update
22 20 18 16 14 US Light Vehicle SAAR Annual average 13.1 14.7 15.6 16.7 March 17.05 15.3 Industry Snapshot Million units NAFTA Light Vehicle Market Condition 16.2 17.0 3% 17.4 3% 17.9 2% 18.3 Country 2014 2015 2016 2017 USA 11.4 11.9 12.2 12.0 CAN 2.4 2.2 2.3 2.2 MEX 3.2 3.3 3.5 4.2 NAFTA 17.0 17.4 17.9 18.3 12 10 Actual IHS Forecast / Mar'15 8 J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M 2012 2013 2014 2015 2012 2013 2014 2015 2016 2017 Light Vehicle Production Passenger Cars 17.0 16.2 15.3 8.3 9.2 10.0 7.0 7.0 7.0 Light Trucks 2% 4.2 4.3 2.5 2.5 1.7 1.8 2012 2013 2014 1stQ14 1stQ15 SAAR reached 17.0 million units during March 2015 Production in North America is expected to reach 17.4 million units in 2015 according to the experts from IHS March inventories closed at a level of 58 days supply, two days down a year ago and close to the industry ideal of 60 days supply. Source: IHS @ March 15 4
Strategic Execution to Capitalize on Market Demand and Opportunities Rassini was awarded with new contracts in North America that will generate additional sales for more than $6,600 million Pesos Rassini installs its second manufacturing plant in the U.S. to machine brake rotors in Michigan, U.S.A. Rassini invests to increase its foundry capacity in Puebla, Mexico with a flawless execution Rassini starts the machining expansion for AUDI operations. 2013 2014 2015
Business Model Focused on Free Cash Flow Generation 7 Highly trained and experienced top notch human talent with a can do attitude Continued investment in Research & Development (focus on product innovation and technology) 1 6 Close relationships with OEMs tailoring their technology needs Profitability and FCF generation 2 Production facilities located in strategic locations (serving customers JIT inventory management) 5 Competitive cost structure based on operational efficiency, lean manufacturing and tight control in all areas Operational flexibility (operation maintained with low level of fixed costs) Quality, production controls and product engineering processes 4 3 6
Consolidated Financial Highlights MxP/USD 1stQ'14 1stQ'15 End 13.08 15.15 Average 13.23 14.93
Consolidated Sales and EBITDA Millions of Pesos Sales EBITDA 11,900 9,353 9,392 10,362 CAGR 09-'14 Sales 17% EBITDA 26% 7,621 1,058 1,178 1,203 1,343 1,568 3,001 3,207 397 537 10 11 12 13 14 J-M '14 J-M '15 8
YTD Sales and EBITDA by Region Millions of Pesos Sales 1stQ14 1stQ15 Actual dist. Sales NAFTA 86% Brazil 14% Consolidated 100% 3,001 3,207 2,305 2,745 (34%) 7% 19% 696 462 Consolidated Rassini Nafta Brazil EBITDA Actual dist. EBITDA NAFTA 96% Brazil 4% Consolidated 100% 537 517 397 344 (60%) 35% 50% 52 21 Consolidated Rassini Nafta Brazil 9
Consolidated Sales Breakdown Millions of Pesos Sales by Product and Region Jan-Mar Jan-Mar 2014 % 2015 % Leaf Springs (1) 1,278 43 1,416 45 Coil Springs 294 10 330 10 NAFTA Subtotal 1,572 53 1,746 55 Brakes (1) 733 24 999 31 Trailers Brazil 2% Aftermarket 3% Sales distribution by customer Other 8% European OEMs 6% Asian OEMs 8% US OEMs 74% TOTAL 2,305 77 2,745 86 Leaf Springs (1) 609 20 395 12 BRAZIL Coil Springs 87 3 67 2 TOTAL 696 23 462 14 OEM: Original Equipment Manufacturer CONSOLIDATED SALES 3,001 100 3,207 100 (1) Includes elimination of intercompany transactions 10
Consolidated Income Statement Millions of Pesos Consolidated Jan-Mar Jan-Mar % Var Income Statement 2014 2015 15/14 Net Sales 3,001.3 3,207.3 7 Cost of sales 2,423.3 2,483.5 (2) Gross Profit 578.0 723.8 25 % of sales 19 23 SG&A 180.6 186.8 (3) EBITDA 397.4 537.0 35 % of sales 13 17 Depreciation 84.8 129.2 (52) Interest & other financial charges 71.1 64.2 10 Other expenses (1.6) 45.8 Income before Taxes & Minority Int. 243.1 297.8 23 Taxes & Deferred Taxes 72.3 73.7 (2) Minority Interest (0.9) (19.5) Net Income 171.7 243.6 42 11
Consolidated Cash Flow Millions of Pesos Consolidated Jan-Mar Jan-Mar % Var Cash Flow 2014 2015 15/14 EBITDA 397.4 537.0 35 Working Capital and Taxes (261.0) (272.8) Net operating cash flow 136.4 264.2 94 Interest expense (37.0) (60.9) Cash flow after int. expense 99.4 203.3 105 Capex (88.7) (114.2) Cash flow available for debt service 10.7 89.1 733 Financing & Amortization Debt (30.5) (82.2) Other (107.1) (46.7) Beginning cash balance 624.7 845.2 Ending cash balance 497.8 805.4 62 12
Consolidated Debt Millions of US dollars As of End of March 2015 Short Term Current Portion LTD Long Term Total Suspension Division NA 22.5 21.3 93.7 137.5 Brakes Division 10.0 6.6 24.1 40.7 Suspension Division Brazil 9.0-6.4 15.4 Cash balance Mar 15 = US$53 mill. Net Debt Mar 15 = US$141 mill. TOTAL 41.5 27.9 124.2 193.6 Long Term Debt Amortization Profile US$ Million 19.5 33.7 34.8 32.6 25.0-2015 2016 2017 2018 2019 2020 Suspension Division NA Brakes Division Note: Debt profile does not include working capital financings and Brazil 13
Financial Ratios by Region (Times) Net debt / EBITDA 1stQ14 1stQ15 37% 1.5 (29%) 1.9 1.0 0.9 1.2 0.6 Consolidated Rassini Nafta Brazil EBITDA / Net interest 105% 44% 21.8 (69%) 5.9 8.5 10.6 3.5 1.1 Consolidated Rassini Nafta Brazil 14
Appendix BMV: RASSINI www.rassini.com
What defines Rassini World s largest producer of suspension components for light commercial vehicles Largest fully integrated brake disc producer in the Americas Absolute Leader in technology and market share designing and producing suspension components and high performance brake rotors. Proven and reliable supplier with more than 85 years in the automotive industry. Within the Top 100 North American suppliers by Automotive News. Recognized year after year for our operational excellence. 16
Our Products 17
Our Presence Flint, MI, USA Plymouth, MI, USA Montpelier, OH, USA Coahuila, Mexico NORTH AMERICA Coahuila, Mexico Leaf Springs and Coil Springs NORTH AMERICA Ohio, U.S.A Coil Springs Michigan, U.S.A. Sales, engineering, research and development Flint, U.S.A. Brakes Queretaro, Mexico Ecatepec, Mexico Puebla, Mexico Xalostoc, Mexico Leaf Springs Queretaro, Mexico Elastomers and Bushing assemblies San Martin Texmelucan, Puebla Brakes Mexico City Headquarters Rio de Janeiro, Brazil Sao Paulo, Brazil SOUTH AMERICA Sao Paulo, Brazil Leaf Springs and Coil Springs Rio de Janeiro, Brazil Leaf Springs Resende, Brazil Distribution Center Resende, Brazil 18
Thank you Francisco Freyre Juan Pablo Sánchez Assistant VP Inv. Rel. and Finance Finance VP ffreyre@rassini.com jsanchez@rassini.com BMV: RASSINI www.rassini.com